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Health plans pay less when PBM owns mail-order pharmacy

MANAGED CARE October 2005. © MediMedia USA
The Formulary Files

Health plans pay less when PBM owns mail-order pharmacy

MANAGED CARE October 2005. ©MediMedia USA

The ongoing debate on whether health plans pay more for drugs when using a mail-order pharmacy owned by a PBM or when the mail-order pharmacy is not owned by a PBM (e.g., Aetna, WellPoint) may be closer to resolution. The Federal Trade Commission finds that prescription drug plan sponsors generally pay lower prices for drugs purchased through PBM-owned mail-order pharmacies.

The findings, reported in "Pharmacy Benefit Managers: Ownership of Mail-Order Pharmacies," couldn't make the Pharmaceutical Care Management Association, the organization that represents PBMs, any happier.

"This report gives a green light to policymakers and purchasers to embrace the PBM mail-service pharmacy option for seniors, the disabled, and working families," says PCMA President Mark Merritt.

Critics say that the extent of PBM revenue — garnered through formulary restrictions, rebates, and other discounts negotiated with pharmaceutical companies — is not fully disclosed, and so it is unclear how much of the savings is passed on to the consumer.

The FTC study was mandated by the Medicare Modernization Act, which established a prescription drug benefit for the elderly.

Total average price per mail order prescription for large PBMs

Source: Pharmacy Benefit Managers: Ownership of Mail-Order Pharmacies, Federal Trade Commission

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